New tobacco study puts EU losses to illicit trade at €11bn

One in every 10 cigarettes consumed in the European Union in 2013 were illicit, 33% of which were ‘illicit whites”, an emerging type of illegal, branded cigarettes manufactured for the sole purpose of being smuggled, according to a KPMG study just published.

The study estimates that at these levels, EU governments lost approximately €10.9 billion to the illegal market. KPMG found that while the number of “illicit whites” consumed increased by 15% compared to 2012, overall, the illegal trade of cigarettes in the EU stabilised, declining slightly from a record high of 11.1% in 2012 to 10.5% in 2013. This stabilization was due to a significant decrease in contraband cigarettes, legal cigarettes typically smuggled from low tax countries to high tax countries, as industry, governments and law enforcement increased efforts to curtail this illegal activity.

*For more on the KPMG study, and the tobacco category as a whole, don’t miss the July issue of Wholesale News.